Book Review: Neil Barofsky’s “Bailout”

My Friday, August 10 column at American Banker is a review of Neil Barofsky’s book, “Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street.”

I had the pleasure of meeting Barofsky for breakfast in New York in the spring as he was wrapping up the manuscript and waiting for the birth of a new baby. He’s a fun guy for me to talk to because he led the Refco fraud prosecutions as a US Attorney. He also spent some time in Colombia, although he admitted he’s forgotten all the Spanish he picked up.

Here’s a quick excerpt from the book review. I’ll be writing more in Forbes about it next week. In the meantime, go to American Banker for the rest.

Barofsky’s book focuses on his efforts as SIGTARP to prevent fraud, not just investigate it after the fact. Frustration grows when he realizes no one at Treasury is much interested in his suggestions on how to structure programs to provide simple safeguards. Barofsky is a former U.S. attorney, a prosecutor who earned his tough-guy reputation putting Refco executives in jail for fraud and bringing Colombian drug dealers to justice. But an IG has to balance the softer goals of audits – supporting improvements and measurement of results in the agency – with the hard-time purpose of investigations which typically intimidate subjects. Barofsky repeats an adage familiar to all auditors: Be a good watchdog, rather than a lapdog or a junkyard dog. Walking that line is tough when you see potential fraud exposure in the billions, like Barofsky did.